Australian Investment in Asian Startups Reaches $24 Billion, Report Finds

Australian investments in Asian startups have reached $23.8 billion over the past decade, according to a new report by Asialink Business and the Tech Council of Australia (TCA).

The report, Building the Australia-Asia Tech Corridor, examines the relationship between Australia’s and Asia’s tech sectors, based on a detailed analysis of Australian investments in Asian tech startups.

The study highlights that the value of Australian investments in Asian startups grew 27-fold between 2016 and 2018. However, the value fell by more than 86% in 2023, dropping to $779 million, marking the lowest level since 2016. This decline is in line with a broader reduction in global venture funding. “While the amount invested year-to-year has fluctuated in line with global conditions, we expect this relationship is here to stay and shows great potential for mutually beneficial growth,” the report noted.

“The development of a robust Australia-Asia tech corridor is critical for fostering innovation, growth, and collaboration; how connections can drive mutual success across both regions,” noted Robert Law, Director of Advisory & Insights at Asialink Business on the importance of these connections.

Key Findings and Trends

The report reveals that Australian investors led 40% of the transactions in which they were involved over the past decade. A significant 77% of these investments targeted seed and early-stage companies in Asia, particularly in the Consumer and B2C sectors.

“Success in Asia requires more than just capital. It demands a deep understanding of local dynamics and the ability to build strong, in-market relationships. Developing Asia-specific capabilities is essential for Australian investors looking to unlock new opportunities in Asia’s tech markets,” Leigh Howard, CEO of Asialink Business, highlighted the strategic need for understanding local market dynamics, said.

Singapore and India as Key Destinations

The research shows that Singapore emerged as the leading destination for Australian tech investments in Asia, accounting for more than half of the total investment value. Additionally, the value of Indian capital raisings involving Australian investors increased by 95% over the decade, with the number of transactions doubling between 2015 and 2023.

“The mutually beneficial exchange of expertise, via talent, investment, or technology, is the foundation of strong economic relationships between Australia and Asia. These connections can support both regions to grow companies globally,” said Damian Kassabgi, CEO of the Tech Council of Australia, on the significance of cross-border collaboration.

Recommendations for Strengthening the Tech Corridor

To further deepen the Australia-Asia tech corridor, the report proposes establishing a regional dialogue between industry leaders and policymakers.

“Establishing a regional dialogue that strengthens the Australia-Asia investment landscape and explores opportunities for collaboration across policy and research will contribute to a thriving tech ecosystem in both regions and drive innovation,” said Susan Travis, Head of Research at the Tech Council of Australia.

The report also identifies Asia’s rapid urbanization as a significant opportunity for tech companies.

“Asia’s rapid urbanisation creates incredible opportunities for leading emerging technology companies to scale. For Taronga Ventures, we see many investment opportunities across the built environment and real asset sectors and this is a strategic driver for long-term growth,” Co-founder and Managing Partner of Taronga Ventures Jonathan Hannam said.

Building the Australia-Asia Tech Corridor is the first discussion paper in the Tech Connections Series. The full report is available on the Tech Council of Australia and Asialink Business websites.